03 May 0
Current legislation requires compliance from qualifying organisations for Phase 3 of CRC by the end of January 2019.
Despite the planned scrapping of the scheme, organisations that used 6 GWh of qualifying electricity from 1st April 2017 to 31st March 2018 will qualify for Phase 3 and are required to fully participate. In the 2016 Spring Budget, the Chancellor announced that the UK Government has decided to close the CRC from the end of the current Phase (Phase 2), and is working with the devolved administrations on closure arrangements. Whilst the Environment Agency is advising that organisations should determine whether they qualify for Phase 3 of CRC, it is also advising that organisations delay undertaking the online registration for the time being. Automatic reminders are currently being generated by the online registry despite the Environment Agency taking steps to stop these from being sent out.
With the progress already made toward the demise of the CRC, it is unlikely that the legislation will remain in force at the deadline for registration. The government has already put in place measures to recover the revenue generated from the CRC scheme. From 2019, a substantial increase in rate of Climate Change Levy (CCL) will recover the income as a pass-through charge by energy suppliers directly through the supply invoice. What is outstanding is the decision on how carbon reporting will be achieved to secure the data currently reported through the CRC scheme beyond 2019. Given the above, it would be remiss of the government to continue to plough resources into the commencement of Phase 3.
Whilst nothing is set in stone, there is little point in organisations investing resources in quantifying energy use until clarity is provided. Furthermore, for organisations that are current participants in phase 2, the data required to establish qualification will be readily available as this will have been collected for compliance with the coinciding reporting year.
Further updates will be provided as progress is announced but the it is quite clear that the sensible option is to take no action at this time.